Work for 375 years on minimum wage to earn annual pay of a FTSE chief executive

Londoners on the minimum wage would have to work for 375 years to earn the same annual pay as FTSE 100 chief executives, a study has found.

Statistics given to the Evening Standard by income equality charity, The Equality Trust, showed that those earning the least now find it nearly impossible to get by in the capital as pay fails to keep pace with the cost of living.

The national minimum wage rose by 12p to £6.31 per hour at the start of this month.

Figures show that while it has gone up 75 per cent since its inception in 1998, the cost of gas has soared 175 per cent, the price of a loaf by 146 per cent and the Tube by 61 per cent. Most significantly, the average cost of rent in London now stands at £1,100 a month. A report by the New Economics Foundation shows that house prices are rising by £106 per day — or a 17-hour shift on the minimum wage.

Labour MP for Hammersmith Andy Slaughter said: “The cost of living is the number one issue for everyone, but for Londoners on low earnings it is terminal. Even for people earning the London Living Wage the only type of housing that is affordable is social housing, and government policies mean there is less not more of that.”

The average energy bill stands at £111 a month, while a zone 1-3 Tube ticket costs £136 and the average monthly food shop stands at £308. From a 37.5 hour week on minimum wage this leaves someone with £399 left to spend, and rent is not included.

These figures come as the number earning more than £1 million stands at over 18,000, the highest recorded in the UK.

Duncan Exley, director of The Equality Trust, said: “The new National Minimum Wage may have risen but it’s still way below a level that people can reasonably live on in London. For the past few weeks politicians have been keen to talk of living standards and the struggles people face. Now we need to see concrete support for policies that help to reduce such huge inequality.”